Protect Yourself from an IRS Scam

Last week a client called me to tell me they got a text from the IRS. It said there was a problem with last year’s tax return, they owed a bunch of money and the sheriff would get involved if they didn’t pay!

Fortunately, my client was savvy enough to know the IRS doesn’t communicate with taxpayers by text. The IRS will rarely call taxpayers either, except when they already have begun a process to resolve their tax situation. A phone call or email is never the IRS’ first communication with a taxpayer.

For the past several years, phone scams and email phishing in which criminals impersonate IRS employees have grown. The Treasury Inspector General’s office (TIGTA) estimates it has received 896,00 reports of scams since October 2013–and that’s just the reports. The number of scam calls could easily be 10 times that or more. TIGTA is aware of over $26 million that has been paid out to the scammers by the unaware. Again, that figure is likely to be much more.

What can you do to protect yourself? The IRS has issued the following guidelines:

The IRS will never:

Call to demand immediate payment over the phone, nor will the agency call about taxes owed without first having mailed you several bills.

Call or email you to verify your identity by asking for personal and financial information.

Demand that you pay taxes without giving you the opportunity to question or appeal the amount they say you owe.

Require you to use a specific payment method for your taxes, such as a prepaid debit card.

Ask for credit or debit card numbers over the phone or e-mail.

Threaten to immediately bring in local police or other law-enforcement groups to have you arrested for not paying.